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Illustrate this change using the aggregate demand-aggregate supply model. What are the effects of this change in the short run and the long run?
What were the cause(s) of the long-run aggregate supply shift during the Great Recession?
What specific numerical evidence would you give to explain why the Great Depression was so much worse than the Great Recession?
What is the key side (supply or demand) of the economy for classical economists? What assumption about prices leads them to this emphasis?
Label the equilibrium price level as P* and the equilibrium level of real GDP as Y*. What is the resulting change in real GDP and the price level?
Since the 1960s, Social Security and Medicare have grown as portions of U.S. government spending. What major categories have shrunk during the same period?
Explain why mandatory outlays are predicted to grow (as a portion of the total budget) over the next decade.
Explain the difference between average tax rates and marginal tax rates. Is it possible for a person’s average tax rate to equal his or her marginal tax rate?
Analyze what is missing from this argument? Name five poor nations that have significant natural resources.
Describe the pattern of world economic growth over the past 2,000 years. Approximately when did economic growth really take off?
Discuss what are the three factors that influence economic growth? How is economic growth measured?
Illustrate the effect of default risk on the price of a bond. What is the interest rate on a one-year $100,000 bond that sells for $97,000?
How will demand be affected if a ratings agency upgrades your bond rating to AA? How will the ratings upgrade affect the price of your bond?
Draw supply and demand curves for your iPong bonds. Label the supply curve S, the demand curve D, and the equilibrium price p.
What is the interest rate on a one-year Ford bond with a face value of $5,000 and a price of $4,750?
What is the rate of return on the one-year Toyota bond? The rate of return of a $1,000 one-year Ford bond must be: less than the return on the Toyota bond.
Why might a firm prefer to finance its investments with bonds rather than stocks? Alternatively, why might a firm prefer stocks to bonds?
If people worried about the United States defaulting on the national debt, what would you expect to happen to interest rates on U.S. Treasury securities? Why?
What is the difference between direct and indirect finance? Discuss the reasons why a firm (a borrower) might choose each method.
How would this change affect the equilibrium interest rate and investment? In the long run, how would this affect real GDP in the United States?
Given your answer to part (a), what can you say about the level of investment in Wahooland relative to that in Wildcat Island in 2015?
Disucss what will happen to the interest rate in that nation? What will happen to the equilibrium level of investment in that nation? Explain your answers.
List the factors that affect the supply side of the loanable funds market. Which factor(s) determine the slope of the supply curve?
Recall the background factors of supply; the first of which that we discussed were "Techniques of Supply".
According to their website, one of the said functions it performs is conducting the nation's monetary policy.